FY26 budget clustered: Pheu Thai grabs 157B stimulus fund

Despite earlier speculation that the Bhumjaithai Party might vote against the bill in a strategic move to challenge the government and replace the prime minister, the ambition of its leadership remains distant. Opposition within Parliament still outweighs support, and the numbers are insufficient to shift the balance of power.

As a result, the ruling Pheu Thai Party and coalition partners appear aligned in their stance, expecting the budget bill to pass the first reading without major resistance.

Following that, a 72-member ad hoc committee will be appointed to scrutinise the bill, with Deputy Prime Minister and Finance Minister Pichai Chunhavajira serving as chairman.

Budget Highlights

An analysis of the top 10 budget allocations reveals the following:

Central Fund – 632.97 billion baht (down 209 billion from FY2025)

Ministry of Finance – 397.86 billion baht (up 8.2 billion)

Ministry of Education – 355.11 billion baht (up 14.3 billion)

Ministry of Interior – 301.27 billion baht (up 6.85 billion)

Ministry of Defence – 204.43 billion baht (up 4.7 billion)

Ministry of Transport – 200.76 billion baht (up 7.4 billion)

Ministry of Public Health – 177.64 billion baht (up 5.67 billion)

Ministry of Higher Education, Science, Research and Innovation – 140.30 billion baht (up 8.05 billion)

Ministry of Agriculture and Cooperatives – 130.11 billion baht (up 7.48 billion)

Ministry of Labour – 68.07 billion baht (up 21.5 million)

Central Fund Under the Spotlight

The Central Fund, which remains under the direct control of the Prime Minister and is used for emergencies and unforeseen circumstances, has drawn significant attention. For FY2026, the allocation stands at 632.97 billion baht, accounting for 16.74% of the total budget—a reduction from the previous year.

The Central Fund is allocated as follows:

Budget for government agencies: 1.41 trillion baht (37.25%)

Integrated expenditure: 98.77 billion baht (2.61%)

Personnel expenditure: 820.82 billion baht (21.71%)

Revolving fund: 274.58 billion baht (7.26%)

Public debt servicing: 421.86 billion baht (11.16%)

Treasury reserves: 123.54 billion baht (3.27%)

Strategic Spending Breakdown

When classified by strategic objectives:

National security: 415.33 billion baht

Competitiveness enhancement: 394.61 billion baht

Human capital development: 605.93 billion baht

Social equity and inclusion: 942.71 billion baht

Environmentally sustainable growth: 147.22 billion baht

Public sector reform and governance: 605.44 billion baht

Push to Increase the Central Fund

Despite the current allocation, there are ongoing discussions within the government to increase the Central Fund by an additional 20–30 billion baht, primarily to prepare for potential economic impacts from the so-called "Trump Tariff" scenario. However, it remains unclear how much leverage “Team Thailand” will have in negotiating favourable terms in the evolving global trade landscape.

 

1.57-Trillion-Baht Stimulus Budget Centralised Under Pheu Thai Ministries

During the Cabinet meeting on May 20, 2025, the government approved the reallocation of 157 billion baht from the central fund under the Fiscal Year 2025 Budget Act. The funds, previously earmarked for the digital wallet handout scheme, have been redirected to a new economic stimulus package aimed at strengthening the country’s economic structure.

Under the new directive, government agencies must submit project proposals through their supervising deputy prime ministers or ministers to the subcommittee for vetting. The Office of the Budget Bureau is expected to receive the final project proposals by the end of May, with Cabinet approval scheduled for June, and budget disbursement to begin by July.

While the stimulus package is framed as a national effort to inject capital into local economies and promote structural transformation, the majority of the proposed spending appears concentrated in ministries overseen by the ruling Pheu Thai Party.

Key Ministries in Focus

The Ministry of Transport, led by Suriya Jungrungreangkit, is preparing to propose a number of infrastructure-related projects, including:

Alleviating traffic congestion in bottleneck areas.

Enhancing travel and transport safety.

Addressing safety at railway level crossings.

Constructing and upgrading truck rest stops in compliance with the Land Transport Act B.E. 2522.

Developing road networks linking secondary cities, tourist attractions, and production zones.

The Ministry of Tourism and Sports, under Sorawong Thienthong, is also set to submit proposals, such as:

Upgrading tourism sites, sports facilities, and visitor amenities (e.g., restrooms, signage).

Improving infrastructure for tourist convenience.

Enhancing safety through the installation of CCTV in key tourist destinations.

Promoting domestic tourism in lesser-known cities and rural areas.

Additional Focus Areas

The stimulus budget will also support measures aimed at mitigating export-related challenges and boosting productivity, especially in agriculture. Proposed initiatives include promoting technology adoption among farmers and SMEs and optimising agricultural land use to suit market demand and climate realities.

State agencies eligible to submit projects fall under the supervision of Deputy Prime Minister and Minister of Digital Economy and Society Prasert Chanthararuangthong. These include:

The National Water Resources Office (NWRO)

The Village and Urban Community Fund Office (VUCFO)

Bhumjaithai Ministries Sees Budget Hikes in FY2026 Amid Political Tensions

As the House prepares to debate the Fiscal Year 2026 Budget Bill, attention is turning to the noticeable increase in funding for ministries under the supervision of the Bhumjaithai Party, which controls four key ministries: Interior, Education, Higher Education, Science, Research and Innovation, and Labour.

All four ministries have received increased allocations in the proposed budget:

Ministry of Education: 355.11 billion baht (up 14.33 billion baht)

Ministry of Interior: 301.27 billion baht (up 6.85 billion baht)

Ministry of Higher Education, Science, Research and Innovation: 140.30 billion baht (up 8.06 billion baht)

Ministry of Labour: 68.07 billion baht (up 21.5 million baht)

The budget hikes have raised questions about whether tensions between the Pheu Thai Party and Bhumjaithai Party, previously at odds, may begin to ease, despite other underlying political frictions.

United Thai Nation Party Criticises Budget Allocation

Meanwhile, the United Thai Nation Party (UTN) expressed dissatisfaction with what it called misaligned spending.

Akkaradet Wongpitakroj, MP for Ratchaburi, criticised the allocation, pointing out that certain agencies were granted budgets that did not reflect the current economic reality.

UTN MPs say they have compiled data and are ready to present critiques and suggestions during both the first reading and the committee stage of the budget deliberations.

Opposition Accuses Government of “Hidden Election Agenda”

On the opposition side, the Progressive Movement-led People’s Party (PP) is preparing for an aggressive dissection of the FY2026 budget.

Sirikanya Tansakul, Deputy Party Leader and Head of the Economic Team, is leading the charge, supported by a rotating team of around 50 MPs, both senior and rising stars.

Natthacha Boonchaiinsawat, Bangkok MP, stated that the PP would target every ministry. He claimed that coalition parties are already manoeuvring for attention, possibly in anticipation of a snap election.

“There are signs that the government may be preparing for the next election. Are there hidden projects embedded in the budget to create political advantage?” he questioned.

The PP has flagged suspicious last-minute projects in multiple ministries, suggesting that some initiatives may be politically motivated rather than economically necessary. Observers will be closely watching whether the opposition can expose irregularities and tie them to election-related manoeuvring.

Opposition Eyes Potential Graft in 157-Billion-Baht Stimulus Package

Opposition parties and critics are closely monitoring the government’s 157-billion-baht economic stimulus package, fearing it may devolve into a massive graft-laden “kickback scheme”. Their concerns stem from the speed at which the budget reallocation was implemented—just three days after Cabinet approval.

One notable red flag: the Department of Local Administration (DLA) under the Ministry of Interior rushed to issue an urgent directive to local administrative organisations (LAOs), requesting the submission of water management projects by May 23, suggesting possible pre-arranged plans.

Khunying Sudarat Keyuraphan, leader of the Thai Sang Thai Party, questioned whether the funds had already been “divided up” behind closed doors prior to the formal reallocation, hinting at political favouritism or backroom deals.

The Real Test: Economic Stimulus or Political Showpiece?

Amid a fragile economy and growing public discontent, the Fiscal Year 2026 budget, totalling 3.78 trillion baht—along with the 157-billion-baht stimulus plan- will serve as a critical test of the Paetongtarn administration’s ability to restore public trust and deliver tangible economic relief across the country.

According to a recent survey by NIDA Poll, gauging public sentiment six months into Prime Minister Paetongtarn’s tenure:

34.58% of respondents said they were “not very satisfied” with the government’s performance.

32.60% were “somewhat satisfied”.

20.00% were “not satisfied at all”.

Only 12.82% said they were “very satisfied”.

When asked about confidence in the government’s ability to address the country’s problems:

36.41% reported having “little confidence”.

26.26% had “no confidence at all”.

25.04% were “somewhat confident”.

Just 12.29% said they were “very confident”

These figures underscore the credibility challenge facing the current administration. The second quarter will be closely watched for any shift in public confidence, as the government attempts to demonstrate that its spending is more than just political optics.

Ultimately, the handling of both the FY2026 budget and the stimulus allocation may become a defining moment for Prime Minister Paetongtarn, shaping not only her government’s performance but also the political capital of the Pheu Thai Party and its coalition partners heading toward the next election cycle.